How to make an NFT? Everything you need to know

Non-Fungible Tokens (NFT) have taken the world by storm in recent years. You may have heard of collections such as the Bored Ape Yacht Club, or disposable creations such as those by artists such as Beeple, or even NFTs made for the meta-verse by companies such as Nike and Gucci.

Whether you think they really are the future of art, music and other fields or an overpriced, hypocritical fad – and there are valid opinions on both sides of the debate – the fact remains that they have become extremely popular very quickly. And if you’re a creative type who wants to put your work in front of a wider audience, there are some good reasons why you might be interested in understanding the process of creating (or “developing”) your own NFTs.

So here’s my quick overview on how to get started and a general guide to the stages of the process to give you a better understanding of one of the most interesting and potentially transforming technology trends.

So what is an NFT?

As the name suggests, an NFT is a symbol (an object that can be used to represent something else) that is not fungible. This means that it is unique – unlike, for example, money, which is a sign of a currency with many units that are all equal.

In digital terms, an NFT is a token stored on a blockchain. This means that it is kept on an encrypted, distributed ledger – a database file of which several versions are stored on many different computers, and no one can change or modify any copy without consensus across the network.

Basically, because NFTs are tamper-proof (thanks to the encrypted nature of blockchains) and unique, they can be used as a unique identifier for another digital asset, such as an image, a video file, a piece of music, or much else. Twitter founder Jack Dorsey created his first ever tweet as an NFT and sold it for nearly $ 3 million.

Why make an NFT?

The most obvious answer to this question may simply be making money. However, the majority of NFTs will not sell for something that the stratospheric amounts we have sometimes seen them go for. In fact, since it costs money to design an NFT, it is likely that most people who try it out will lose money in the process – although there are a few options to minimize the risk of this happening, which we will cover below.

However, there are still some good reasons to try. If you plan to earn a living by selling art, the NFT offers an interesting new model for building bridges between creators and consumers. First, they allow creators to reduce the hassle and cost of dealing with many of the middlemen who may be involved in marketing and selling their work. All that is required is to understand a little about the technological components involved, such as wallets and marketplaces, and you are up and running.

Second, because they are blockchain-based – typically on platforms such as Ethereum, Solana, Binance and Tezos – they can take advantage of the “smart contract” functionality offered by these networks. This means that they can be programmed to execute code, and typically with NFT sales, this means code that ensures that each time NFT is resold, part of the revenue goes directly to the original creator.

Another reason why you might want to create an NFT is simply to understand the technology. Although we currently mostly hear that they are used to sell art and other creative works, all kinds of goods are sold – from event tickets to rare whiskey and even diamonds – with NFTs. Understanding the impact this new technology is likely to have on your industry, whatever it may be, is a valid reason why many people may be drawn to learning and experimenting with the tools and platforms of the NFT ecosystem.

Where do I start?

First, as mentioned above, you will choose which blockchain you want to use to create your NFT. Ethereum is by far the most popular blockchain used to hold NFTs, but it comes with some significant drawbacks. One of these is the high environmental costs associated with proof-of-work blockchains – which Ethereum still is, despite ongoing attempts to switch to a less energy-intensive proof-of-stake model. The technical differences are beyond the scope of this article, but you can read a primer here. Other networks such as Polygon, Solana and Tezos are already proof-of-stake, so if you know that the computers used to mint your coins generate carbon emissions, you may want to choose one of these.

Another disadvantage of using Ethereum is that the fees – known as gas charges – that are charged for using the network are significantly higher than on many other blockchain networks. The fee varies depending on how busy the network is, but usually starts at around $ 20 to $ 30. On other networks, the fees are more likely to be denominated in cents.

Then you will choose your marketplace. To some extent, this decision will be made for you depending on the blockchain network you want to use. The largest NFT marketplace, OpenSea, for example, supports NFTs that live on the blockchains Ethereum, Klatyn, Polygon and Solana. If you want to use Binance Smart Chain, your options will include Binance NFT Marketplace, Venly and Refinable.

Another popular NFT marketplace is Rarible, which allows you to use the Ethereum, Flow and Binance smart chains. As with anything related to NFTs, there are pros and cons to each option, and it is often a matter of making trade-offs – choosing a more popular marketplace with a potentially larger audience, but higher fees, versus choosing a less popular but cheaper marketplace, for example. Using Ethereum – while more expensive and (potentially) more polluting in terms of emissions – also means that your customers have the option to pay with ETH, one of the most popular cryptocurrencies. Using other networks such as Polygon or Tezos means that customers may have to pay with their associated cryptocurrency tokens, of which there are simply fewer in circulation.

Once you have an idea of ​​the chain and marketplace you want to work with, you need to get a wallet. Although there are various options, an easy choice here is to simply use Metamask – which integrates well with many of the most popular NFT marketplaces, so you can transfer NFTs right into your wallet. Math Wallet and Coinbase Wallet are other well-supported alternatives.

One point to keep in mind if you are interested in the technical is that, despite the name, wallets do not store your NFTs. The NFTs themselves are stored on blockchains that are stored in a distributed manner on hundreds or thousands of computers around the world. Wallets simply store the private keys used to prove ownership of a particular NFT to the algorithms that keep all copies of the blockchains synchronized.

After setting up your wallet – which is usually either a smartphone app or a browser extension – it is usually just a simple matter to connect it to the marketplace you want to use to sell or trade your NFT.

Now, with your wallet set up and connected to the selected marketplace, it’s time to finally create that NFT.

Create your NFT

This is one of the easiest steps without any really tough decisions to make. The marketplaces offer all the functionality that allows you to create your NFT by simply uploading the artwork (or whatever) that you want the NFT to represent and connect to it. This is very simple, and marketplaces, such as OpenSea, guide you through the process of creating and adding necessary and optional metadata. You can enter some information so that it is only visible to the buyer of NFT (useful if you are creating objects for a game or a code to redeem if NFT is linked to a physical object that the buyer can obtain).

Unfortunately, this is where things start to cost money. With NFTs, fees accrue each time changes are written to the blockchain, and this is probably where this will begin to happen by affecting your NFT. As mentioned above, stamping on the Ethereum blockchain is the most expensive of the options available, but you will have a larger pool of potential buyers and be able to accept payment in ETH, the second most popular cryptocurrency (after Bitcoin).

However, there are a few ways around these fees. First, and most obviously – use a blockchain and marketplace combination that does not involve fees. A popular alternative here is to shape the Polygon blockchain (a relatively environmentally friendly blockchain that uses proof-of-stake) by using the OpenSea marketplace. At the time of writing, this combination can be made without incurring any fees.

If, on the other hand, you have your heart set on the super-popular Ethereum blockchain, you may want to explore the “lazy minting” options offered in some markets, including OpenSea and Rarible. This allows you to create NFTs that are not actually distributed to the blockchain before someone buys them – then the minting fees are combined with the sales fees.

Once created, the NFT should appear in your own wallet to show that it belongs to you and is ready to trade.

Selling your NFT

So here’s the fun part, where you finally (and hopefully) see a reward for all your hard work. As you may have guessed from their name, the marketplaces are there, in addition to creating and embossing your NFTs; you actually sell them.

Depending on which blockchain and marketplace you have chosen, you will have the opportunity to sell either at a fixed price, through an auction or a bidding system. Bidding works much like an auction, but there is no time limit – buyers simply offer what they want to pay, and you, the seller, choose to accept or reject each offer.

This is the point where you can also specify options such as recurring royalties – which means that you will be paid a percentage of all resale of NFT, if the buyer decides to resell it at a later date.

So you are ready to become an instant millionaire. One small problem – so are thousands of other artists and creators, and right now the amount of buyers willing to spend enough to make it is not large enough to make everyone rich. If you have been following the news on the subject, you are probably aware that the amount spent on NFTs is currently far lower than it was at the peak of the hype cycle, during 2021 – when sales for millions of dollars plus. happened on a daily basis. This is not necessarily a sign that interest is waning. Many believe that although the first wave of excitement was around art and speculative assets, the true value of technology will be linked to the advent of the metaverse and enduring digital worlds. If this is true, it is likely that NFTs will continue to play a far greater role in our lives in the future.

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